Millions across the UK face losing out on nearly £1,500 per year as the Bank of England looks set to raise interest rates from 2.25 per cent to three per cent.

The Bank of England is poised to unveil the biggest hike in interest rates for 33 years next week as the central bank continues its efforts to tame inflation.

It will be the eighth consecutive jump in interest rates by the Bank but will represent the biggest increase since 1989.

The price hike means homeowners on a standard variable rate mortgage could see their annual payments rise by £1,476 a year.

Sarah Coles, personal finance expert at Hargreaves Lansdown said: "For anyone on a variable rate mortgage – like a standard variable rate or a tracker mortgage – much of this rate rise is likely to be passed swiftly through into your monthly payments."

The number of mortgage approvals fell significantly in September, the Bank of England said mortgage approvals for house purchases decreased to 66,800 in September, from 74,400 in August.

Karim Haji, UK head of financial services at KPMG, said: "As we saw in September, lenders reacted to the market turmoil by repricing mortgage rates or withdrawing products altogether."

Your Money Matters

Your Money Matters is a campaign launched by us and our sister titles across Newsquest to help you overcome the surge in the cost of living.

This year has seen a whole host of household price increases — from the energy price cap rise to surging inflation and food prices — costing your family hundreds or even thousands of pounds extra per year.

We’re making it our mission to look out for your cash, offering money-saving deals, competitions, giveaways and insightful stories from your community on the impact this cost-of-living crisis is having on our readers.

The worldwide energy crisis exacerbated by the Ukraine invasion, the financial impact of the Covid pandemic, record inflation figures and a surge in the cost of goods, fuel and travel means we will all feel the pinch.

Through our newspaper, we want to do what we can to help make your cash go further because we know your money matters.